Los Angeles, February 29, 2008 (LPAC)-- As the state of California plunges deeper into an economic/financial collapse - which Governor Arnold Schwarzenegger calls a "budget crisis" - he was once again caught lying Thursday when he addressed business leaders in Los Angeles. In his speech, Schwarzenegger endorsed proposals from Legislative Analyst Elizabeth Hill to close tax loopholes. Hill argued that his budget, which calls for 10% across-the-board cuts, is unfair, as it places too much emphasis on slashing or eliminating programs designed to protect those most dependent on government aid.

"I think we should go after those tax loopholes," he said, which Hill estimated would give the state an extra $2.7 billion. Arnold added that the extra revenue from closing the loopholes could go "straight to education."

However, immediately following the event, he changed his tune. When asked if that means he will go immediately to the legislature and ask them to close the loopholes, he said, "I'm not for the recommendations she made...." When there was a follow-up question, asking how he could keep a $21 million loophole for owners of yachts when necessary state programs were being slashed, Schwarzenegger shrugged, saying that "some of my colleagues are very strong in lobbying for keeping that."

Arnie was thus caught, again, lying to the public. And while he continues to insist that the only way to balance the budget is by destroying the social safety net built up since the 1930s Depression, thereby throwing millions of poor, elderly and disabled onto a human scrap heap, the state's economy continues in free fall. The official number of unemployed jumped by another 20,300 in January, with the capital city, Sacramento, hitting an official unemployment rate of 6.4%, the highest level since January 1997, when the state was coming out of a recession. In addition, the City of Sacramento - which has one of the highest rate of homes posted for foreclosure in the nation - announced a plan to cut 500 jobs from the city's payroll, to deal with a growing city budget crisis.